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Views mixed on RGHS-Unity merger

Rochester Business Journal

June 20, 2014

Pluralities of respondents to this week’s RBJ Daily Report Snap Poll say the merger of Rochester General Health System and Unity Health System is likely to improve the quality of health care locally but have a negative impact on costs.

Half of readers responding to the poll anticipate a positive impact on the quality of health care in this region. The remaining half is evenly split on whether the merger would have a neutral or a negative impact on quality.

Forty-one percent of respondents said the merger will have a negative impact on the cost of health care. That compares with 30 percent who predicted a positive impact and 29 percent who said the effect would be neutral.

With recent approvals from the state Department of Health and the Federal Trade Commission, the proposed merger of RGHS and Unity has cleared its final hurdles and is expected to be completed by next month.

The merger will bring together the region’s second- and third-largest health systems, creating a regional health care network that spans four counties. With roughly 14,000 employees, the merged system will rank as the area’s second-largest employer, trailing only the University of Rochester. UR employs more than 20,000 people, including some 14,000 at its medical center.

RGHS and Unity CEOs Mark Clement and Warren Hern have said the merger, prompted by health care reform, will create an integrated health care system designed to improve quality and lower the cost of care by building critical mass and creating economies of scale.

Clement and Hern have declined to be candidates for CEO of the merged system. A search for a new CEO has begun.

Some experts have a different view of health care mergers. A June 2012 report from the Robert Wood Johnson Foundation concluded that “hospital consolidation generally results in higher prices.” It also found that most mergers result in poor integration of care, though integrated care delivery is a goal of the proposed RGHS-Unity merger.

Roughly 425 readers participated in this week’s poll, conducted June 16 and 17.

In your view, is the merger of Rochester General Health System and Unity Health System likely to have a positive or negative impact in this region on:
Quality of health care
Positive 50% Negative 25% Neutral 25%

Cost of health care
Negative 41% Positive 30% Neutral 29%

COMMENTS:
This poll comes at an ironic time; Excellus BlueCross BlueShield just sent its reasons to raise the cost of premiums to the state. All premiums are going up, from my understanding. If mergers truly happen to decrease costs, why are the consumers not reaping the benefits?
—Kathy Keady

Any move on the part of RGHS and Unity to counterbalance UR/Strong’s 800-pound gorilla is a good thing. Strong has had its way in the Rochester area, and now we will have the second-biggest employer in the Rochester area and a 700-pound gorilla. Hopefully some of the savings gained from unifying the two systems will be passed along to the patients, or at least the insurances. The promised gains of improved quality and lower costs have not been realized.
—Clifford Jacobson M.D.

Many low-end non-patient-care jobs will be eliminated. However, the top administrative positions will be awarded millions of dollars and cancel out any savings obtained through the merger.
—Ed Rosen, Fairport
Unfortunately, some of the cost-saving may come at the hands of job cuts. Redundant positions are found, but may open up other opportunities. Would be nice to see Rochester lead the way in reducing the cost of health care while increasing quality of health care at the same time.
—Keith Newcomer

If you look at some other city models, hospitals have specialty areas, instead of duplicating expensive equipment and staff. Examples might be one hospital is the cardiac hospital and the other is the trauma. Another might be orthopedic. RGH/Unity and UR Med should work together for the common good and controlling costs. A better community partnership might also benefit the UR School of Medicine and its medical residency and other allied health programs in the Greater Rochester area.
—Michael E. Pollock

The merger is more for Unity and RGH to combine forces to be competitive with the Strong system. It will have little to no impact on health care costs and quality.
—Leslie Apetz

With Strong and Highland acting together, there needs to be a counter-balance. However, there will be staff reduction, which isn’t welcome in our city.
—Wayne Donner, Rush

My opinions are based on the intelligent use of the merger function: Share the increased revenues while cutting operating and medical costs. If this is not done, then my conclusions are not valid. Case in point: If we pay the new CEO more than we paid the two previous CEOs, then we are on the wrong track.
—J.A. DePaolis, Penfield

Obamacare supports efficient health providers and to some degree keeps prices lower than the old system. Replace the greedy, money-hungry top management with others who will focus on the patients. Change the financial part to high levels of bookkeeping and to the highest degree of stewardship. Money is a tool only; use it for the betterment of the system.
—Ingo H. Leubner,
Crystallization Consulting

Competitive options and choices are best for humans. Big is not better; it is worse. We are not talking the commodity of widgets. This is about humans and their well-being.
—Eve Elzenga, Eve Elzenga Design

For more comments, go to rbjdaily.com. To participate in the weekly RBJ Snap Poll, sign up for the Daily Report at rbj.net/dailyreport.asp.